April 18, 2016

Australia's Turnbull Coalition Government has made a major
announcement today which covers a continuous building program for three surface
vessel classes. These are Offshore
Patrol Vessels (OPVs), Future
Frigates (FFs) and Pacific Patrol
Boats (PPBs).

The announcement is aimed at improving the Coalition Government's chances of winning the next Federal Election, which appears very likely to occur on July 2, 2016. [P.S. it did occur on that date]

The announcement in particular is aimed at improving the
Turnbull Government prospects in South Australia, which is described as a swing
state, where Coalition MP and Senate positions may be lost. South Australia was promised the FF build months ago and the OPV build was also thought likely in South Australia. This helps protect
the seat of the most important Government MP in South Australia who is the
Industry Minister, Christopher Pyne. South Australia is heavily contested
between 4 parties: the Liberals, Labor, Greens and the emerging Xenophon Team.

The other major beneficiary of the announcement is
Western Australia – with the most prominent MP being the Foreign Minister (also
Deputy Leader of the Liberal Party) Julie Bishop. Austal
at Henderson (part of Perth) Western Australia specifically benefits. Western Australia is normally Liberal, that is
pro-Coalition but Labor is significant. The shipbuilder Civmec is likely to benefit in Western Australia. Civmec also owns Forgacs shipbuilding sections interests at Tomago, NSW. The Defence Minister Marise Payne is a
Senator from NSW.

Cairns in Queensland gains from PPB maintenance.

The big loser is Williamstown dockyard in Victoria,
considered a Labor heartland. The Coalition has few seats in Victoria to lose,
so this shipbuilding announcement doesn’t favour or even mention Victoria.

A future submarine announcement, however, may benefit Williamstown
Victoria, and also South Australia and Civmec Western
Australia. If any announcement on submarines is made before a July 2, 2016
election it is likely to imply but perhaps not specifically promise that all submarines will be built in Australia. There is
probably insufficient time and political risk in the run-up to an Election of
specifying the actual winning contender (or a shortlist of two).

The Turnbull Government is securing a sustainable
long-term Australian naval shipbuilding industry.

Today the Government is announcing the build
locations for 12 Offshore Patrol Vessels and up to 21 Pacific Patrol Boats, in
addition to nine Future Frigates previously announced.

These announcements provide for two shipyards to
implement the Government’s commitment to a continuous build of naval surface
ships in Australia. Major warships will be built in Adelaide and minor vessels
in Henderson, Western Australia.

These three projects will ensure Australia retains
a sovereign capability to build and sustain its naval vessels. Together they
represent close to $40 billion worth of investment in Australia’s future naval
capabilities and our naval shipbuilding industry.

They will directly secure more than 2,500 jobs for
decades to come. They will also generate thousands of additional jobs with
suppliers.

Offshore Patrol Vessels

·First pass approval for the Offshore Patrol
Vessels, with construction to begin in Adelaide from 2018, following the
completion of the Air Warfare Destroyers and transfer to Western Australia when
the Future Frigate construction begins in Adelaide in 2020. This approach
ensures that jobs and skills are retained in Adelaide.

·As part of the Competitive Evaluation Process three
designers have been shortlisted;

·The Competitive Evaluation Process is on schedule
to return second pass approval in 2018, which will allow for construction to
commence in Adelaide in 2020.

·This program is estimated to be worth more than $35
billion, and will directly create over 2000 jobs.

Pacific Patrol Boats

·Combined first and second pass approval for the
replacement Pacific Patrol Boats. Austal Ships Pty Ltd has been selected
as the preferred tenderer to construct and maintain up to twenty-one
replacement steel-hulled Pacific Patrol Boats in Henderson, Western Australia.

·Subject to negotiations, this program is estimated
to be worth more than $500 million and will directly create over 130 jobs.

·Austal proposes to conduct support of the
replacement Pacific Patrol Boats including deep maintenance from Cairns,
Queensland. In total, through-life support and sustainment (including deep
maintenance) for the Pacific Patrol Boats is valued at a further $400 million
over the life of the boats.

Today’s announcements are central to the
Government’s comprehensive Naval Shipbuilding Plan. These three significant
ship builds will deliver the necessary infrastructure requirements across the
Adelaide and Henderson shipyards. They will create new jobs, develop necessary
skills and broaden cooperation between industry and government.

The Turnbull Government is committed to maximising
the opportunities for our Australian Defence industry to participate in these
shipbuilding programs. Through the Defence Industry Policy Statement the
Turnbull Government will reset the relationship between Defence and industry,
driving jobs and innovation which will have spillover effects into the wider
economy. In particular, the new Centre for Defence Industry Capability
will help small to medium enterprises identify opportunities to join the supply
chains necessary to deliver these ambitious naval shipbuilding projects.

After six years of Labor inaction in which more than
$18 billion was ripped from the Defence budget, the Turnbull Government is
getting on with the job of securing our long-term national security and
economic prosperity. The Government’s historic continuous build program will
ensure the Navy receives its future capability requirements while delivering
the certainty that shipbuilders need."

ENDSPlease connect with:A good ASPI Strategist commentary on the coming congestion in Adelaide of building so many ship/submarine types, sustainment and upgrades - is Mark Thomson's "Building the future Navy: the OPVs" of 28 April, 2016.Pete

13 comments:

I'll take the Fassmer OPV 90 and the Italian FREMM (which I've been saying for a while that is the closest thing to what we're after in regards to a ASW Frigate)Hope the navy gets the MILAS missiles with it as well.

French must be pissed. I'm very surprised the Germans didn't get a look in with the Type 125?!? (I thought it was quite good) too big? too expensive Perhaps?https://www.aspi.org.au/__data/assets/pdf_file/0016/26503/Kamerman-The-German-experience-slides.pdf

If the Govt. wanted to save money why didn't they consider the Iver Huitfeldt class?!?

I'm not a fan of the Spanish design, it's too old and I'm not sure they can redesign it for electric propulsion.

I am aware the Fincantieri version of the FREMM (at 6,700 tonnes) has greater capabilities than the French version (6,000 tonnes). This includes greater hangar space (enough for 2 helicopters) in the Fincantieri.

As well as ASW in the Frigates selectors are looking for VLS for at least 16 Tomahawk, and also some air warfare capability.

German Type F125 or Baden-Württemberg-class is a ship with long endurance between returning to home port. Two years are envisioned. This class has currently not much fighting capability but space to do so. This class is to keep the F124 class away from peace-keeping missions.

F124 or Sachsen-class is a child of the Trilateral Frigate Cooperation (TFC). Other children with different toys are Álvaro-de-Bazán-Class and the De-Zeven-Provinciën-Class. So there is a somehow German ship around.

The upfront price for the Spanish design might be cheaper as Australia should know from Can erra-Class.

Surely a coherent process is one that has design settled before the shipyard is chosen. It seem to be a cart before the horse approach, all for naked electoral advantage.It can only end in tears.As for the Submarine choice:

As this is the 'pathway' that SEA 1000 website indicates as its preferred processDepartment of Defence will seek proposals from potential partners for:

Pre-concept designs based on meeting Australian capability criteria;Options for design and build overseas, in Australia, and/or a hybrid approach;Rough order of magnitude (ROM) costs and schedule for each option; andPositions on key commercial issues, for example intellectual property rights and the ability to use and disclose technical data.

This is before choosing an overseas designhttp://sea1000.gov.au/current-activities/competitive-evaluation-process/

The Luerssen OPV seems especially interesting, as the top end version has a large helicopter deck ( but no hangar which could be added)) and a 57mm gun. But the interesting bit is the rear loading ramp and door over the stern. An RIB can just run up while underway. Very innovative for this type of vessel as normally you go to much larger for a launching dock.http://www.luerssen-defence.com/en/naval-vessels/opvs/pv-80

Yes its an interesting article in The Australian today April 19, 2016 http://www.theaustralian.com.au/national-affairs/defence/japanese-send-submarine-in-a-first-proof-of-good-design/news-story/4945bac8f675548605133dd92f2de102 which indiactes:

"The [Australian Government's] National Security Committee will today consider the navy’s recommendations on which of the contending designers from Japan, France and Germany to choose."

As the winner(s) of the submarine contest is a high cost project and important policy decision electoral conventions would indeed mean any announcement made would be before the Caretaker Period (maybe beginning May 4, 2016) and (if later) should be after the very likely Election Date of July 2, 2016.

Turnbull appears desperate enough to take the political gamble of announcing the submarine winnerin the next 2 weeks. In that case it would fall to the Winner to be very careful concerning where in Australia it might give most of the submarine build work (what seats/electorates, cities and States)

The CEP process is much more fluid, open to political priorities, than a formal Tender process.

The process at http://sea1000.gov.au/current-activities/competitive-evaluation-process/ may now have done by the CEP Assessment people. They apparently have passed their advice for Cabinet decision possibly today. Announcement of the Winner or narrowing down to 2 Winners may occur at a date the Government thinks politically advantageous.

Once a Winner is declared the Winner would be on firmer ground to negotiate contracts with Australian companies for joint ventures, contracters and sub-contractor/suppliers.

As ASC and Adelaide might get the main work all the defects of the Collins process may be repeated. But the real problems may only come out after the Australian subs begin to be built, around 2028.

It's good to see the government serious about naval hardware. The frigates are almost the same as the Hobart class destroyers in tonnage and size. Essentially we'll have 12 destroyers, or 12 large frigates. It'll be exciting to see them armed with the anti ship missiles derived from the SM-6 missile.

I was also wondering what the difference between an "Offshore" patrol vessel and "Pacific" patrol vessel was. Is the Pacific patrol vessel a smaller one for "brown water", between Pacific islands and "Offshore" bigger to go into the middle of the Indian ocean, and down to Antartica?

In any case, it'll be exciting to see the final winner's designs for the subs and surface ships.

Main difference between OPVs and PPBs (https://en.wikipedia.org/wiki/Pacific-class_patrol_boat#Replacement ) is not where they can go put what Australian purchase and maintenance cost structure applies to them. Australia has decided to devote more resources to each OPV and use them for a wider range of roles - hence they are much so they are much larger than the PPB.

I think most naval vessels built in Australia will be always much more expensive than in their "home country". But if you plan for the worst, a war, Australia needs to have facilities and skilled people who can do manufacturing and maintenance of them. Australia's lucky, being wealthy, so we can afford to do so.

Some of those Fassmer OPV look quite exciting, especially the 98m version.

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